According to a study recently published by Outsell, Inc., the leading information content industry research and advisory firm, the industry slowdown in 2001 has left Primary Publishers struggling to find and exploit new electronic distribution channels, and prompted News Aggregators & Infomediaries to reposition themselves as full-service providers of content, proprietary technology, and other services.

The Outsell report, part of a massive market sizing initiative on the business-to-business portion of the News & Trade (N&T) segment, identifies 146 companies in this sector. The market is segmented into two business model types: News Aggregators & Infomediaries, who aggregate and/or syndicate content from multiple publishers; and News & Trade Primary Publishers, who create original news content for printed news publications such as newspapers, trade journals, and magazines. Primary Publishers also include newswires and news services.

Outsell estimates that the 2000 worldwide market for N&T information is $95.8 billion, an increase of 5.2 percent over the previous year. The top 10 companies in the overall N&T segment represent 38.5 percent of the market, with no one company claiming 10 percent or more of market share. While the top 10 companies have experienced a growth rate of 12.4 percent (represented primarily by large newspaper publishers), the remainder of the companies grew by only 1.2 percent. The News Aggregators & Infomediaries segment, which is a small sector relative to the Primary Publishers segment, experienced a robust growth rate of 30.2 percent.

"The 2000 market size numbers paint quite a different picture compared to the downturn and subsequent fallout that took place in 2001," said David Curle, director & lead analyst at Outsell. "Publishers' expectations of spinning Internet-based subsidiaries into moneymaking IPOs has all but eroded, leaving them with the task of folding those units back into their core operations. Also, the slowdown in advertising spending has compelled several major players to announce layoffs and cost-cutting measures, and search for new ways of electronically distributing their content via secondary channels to generate new revenue opportunities."

"Primary publishers can no longer rely on the aggregators and infomediaries to syndicate their content," Curle said. "As a result, many publishers are consolidating their media holdings, as well as rebuilding their own internal organizations, to efficiently distribute the right content at the right price, and effectively deliver the most bang for the advertising buck."

According to the Outsell study, the rapid dissolution of the dot com market, once flush with venture capital and eager to add content to their sites, has cast a pall over the News Aggregator & Infomediary segment of the market. With iSyndicate being acquired by Yellowbrix, Screaming Media recasting itself as an infrastructure company, and COMTEX undergoing staff reduction, the remaining core companies in this sector are increasingly trying to become full-service providers by offering different combinations of content, software, and technology that can be combined into enterprise processes, tasks, and decisions.

"News aggregators are turning toward the enterprise market for more stable sources of revenue than are available on the open Web," added Curle. "By providing software and services along with content, aggregators enable their customers to more easily integrate and embed external content feeds into corporate Web-based interfaces. Unfortunately, this development comes at a time when most enterprise budgets are tight, and many projects are being blocked by economic limitations."

Outsell's comprehensive study findings are detailed in the company's recently published Briefing entitled "Industry Trends, Size, And Players In The News & Trade Information Market." The report provides a company description and URL for each of the 146 industry players, their estimated 1999 and 2000 revenues, ranking, and market share. It also provides analysis and advice to buyers, sellers, and analysts covering the N&T Information Content Industry. A complete list of all the companies is provided in the appendix of the report in both alphabetical and rank order, broken out by Primary Publishers and by News Aggregators & Intermediaries.

Availability

The Briefing is available for $1,495 and can also be obtained as part of the complete series of seven industry reports, "Industry Trends, Size and Players in the Information Content (IC) Market," for $6,000.

About Outsell

Founded in 1994, Outsell is the only research and advisory firm that focuses exclusively on the Information Content industry, delivering high-quality, fact-based research, analysis, and advice about every aspect of content strategy, deployment and use to a wide range of vendors, buyers, and users of information. Outsell has helped world-class content leaders and Fortune 1000 companies increase their understanding of users and end-markets, assess content quality and effectiveness, benchmark operations, and develop more successful content products and services.

Outsell, Inc. 330 Primrose Road, Suite 510, Burlingame, CA 94010

Phone 650/342-6060; Fax 650/342-7135; Web: www.outsellinc.com.

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